OSAKA – Against expectations and despite fundamental policy differences, Osaka Mayor and Nippon Ishin no Kai (Japan Restoration Party) head Toru Hashimoto and former Tokyo Gov. and Taiyo no To (The Sunshine Party) leader Shintaro Ishihara merged their parties Saturday, creating a third force in Japanese politics.

The tieup, announced at a news conference in the city of Osaka by Hashimoto, Ishihara and Ichiro Matsui, Nippon Ishin no Kai’s secretary general and governor of Osaka, establishes a new party with a basically conservative and probusiness policy platform.

It is designed to capitalize on Hashimoto’s popularity in Osaka and elsewhere among younger generations disillusioned by the economic slump of the past two decades, and on nationwide support for Ishihara among older, traditional conservatives and ultranationalists.

The new party will retain the name Nippon Ishin no Kai and will include former members of Tachiagare Nippon (Sunrise party of Japan), the small ultraconservative party headed by Takeo Hiranuma that was folded into Taiyo no To last week.

Ishihara will lead the party, with Hashimoto serving as second in command. Hiranuma will replace Yorihisa Matsuno as head of Nippon Ishin no Kai’s Diet contingent, and Matsuno will become his right hand man.

Relations between Nippon Ishin no Kai members and Tachiagare Nippon had long been contentious, and only a week ago, Hashimoto was saying a tieup with Ishihara would be difficult with Hiranuma present.

The new party also named 47 first-round candidates for the Dec. 16 Lower House poll, while Hashimoto added that Nippon Ishin no Kai’s current head office in Osaka and branch office in Tokyo will remain in place until the election is over.

Key policy differences between Hashimoto and Ishihara had many in Nippon Ishin no Kai and in Osaka convinced they would not be able to pull off a merger.

Ishihara opposes the Trans-Pacific Partnership free-trade pact, which Hashimoto supports. Hashimoto and Nippon Ishin no Kai have meanwhile pushed for the elimination of atomic energy by the 2030s, while the pronuclear Ishihara continues to believe the power source will remain necessary, not only for economic reasons but also to use as a diplomatic card with other nations.

In this regard, the two sides appear to have reached a compromise.

During a plenary meeting of Nippon Ishin no Kai members earlier Saturday, Matsui, the party’s secretary general, said the new entity will agree to pursue TPP negotiations with an eye to Japan joining the regional trade accord — unless the discussions appear to run counter to the national interest.

Meanwhile, Hashimoto’s goal of becoming nuclear power-free in the 2030s was axed in favor of an emphasis on deregulating the energy sector, according to Matsui.

Matsui also said that agreements in a number of basic policy areas had been reached with Taiyo no To prior to the merger, including the importance of striving to introduce an administrative system based on regional blocks, and eventually turning the consumption tax into a local levy.

The new party will not include Nagoya Mayor Takashi Kawamura’s Genzei Nippon (Tax Reduction Japan) party. Ishihara and Kawamura had announced they would tie up last week in a move that surprised and irked Hashimoto, who complained he had not been consulted beforehand and criticized Ishihara’s move.

Meanwhile, Your Party, with whom Nippon Ishin no Kai is extremely close, will not merge with Hashimoto’s party and will remain separate. However, postelection cooperation between the two parties is highly likely.

The announcement of the merger between Hashimoto and Ishihara was met with a wave of skepticism, as well as questions over how, exactly, their new party might function after the Dec. 16 election. It appears highly unlikely Hashimoto and Ishihara will secure the minimum 241 seats needed to capture a majority and thus become the ruling party.

“I have doubts about whether things (between Hashimoto and Ishihara) will go well. Their policies are different, and factionalism between the two parties’ supporters will likely prevail,” said Yuji Yoshitomi, an Osaka-based freelance journalist who has written about Hashimoto.

Analysts predict an outbreak of internal warfare in Nippon Ishin no Kai once the final votes are counted, with power tipping either toward Ishihara if the majority of winning candidates are from the Kanto region or, like Hiranuma, are older allies of the governor, or Hashimoto’s way if most of them hail from Kansai or other western regions where the Osaka mayor’s support rating is higher than in eastern Japan.